When a company experiences a change in control, employees will likely begin feeling uneasy because of the unknowns. Change is inevitable and any successful company will need to be adequately prepared when a shift does occur.
Changes of control often involve one of the following:
- Sale of assets
- Transitional events
During these types of changes, the individuals whose hard work has resulted in this profitable transition may not be sufficiently rewarded. In certain cases, these very persons may even be left out completely.
Change of control, or change in control, agreements address rights and privileges that are granted to an executive when a company undergoes a major shift, such as the ones listed above. These documents will likely address:
- Executive compensation/bonuses
- Vesting of employee equity
- Severance and termination arrangements
During this exciting time, having a well-articulated arrangement is essential. You may need assistance negotiating the terms of the document or drafting it in such a way as to avoid tax or securities law issues.
These documents are especially critical for entrepreneurs and executives who have a substantial amount of equity in their employers. A well-drafted document can protect the equity as the employer undergoes a corporate change in control. This is done by minimizing future disputes and laying out specific rights.
Legal Assistance with a Change of Control Document
At The Prinz Law Firm, our Chicago employment law attorney is committed to helping those who need assistance in retention and change of control issues. Our goal will be to help make arrangements that adequately protect the company, employees, and executives. Reach out to our firm at your earliest convenience for assistance with a change of control agreement!